We have studied recently the mechanism of release and mode of action of the paracrine and neurocrine peptides of the gut, chiefly vasoactive intestinal peptide (VIP), the opioid peptides (met-enkephalin, leu-enkephalin and dynorphin), somatostatin and substance P. The chief location of these peptides is in the neural plexuses; a dual location applies to somatostatin in the proximal gut. We have used an isolated vascularly perfused rat stomach preparation with which to probe the functional link between gastrin and somatostatin secretion in the antrum. Our results suggest that somatostatin is the inhibitory limb and neural bombesin is the stimulatory limb of the gastrin control mechanism in the antrum. We have also studied the release of VIP from the intestine in vivo and in vitro and shown that circulating VIP originates from gastrointestinal nerves mainly. We have studied the neurotransmitter function of VIP and the opioid peptides using isolated gastric smooth muscle cells from the guinea pig and other species. We have demonstrated the existence of opiate receptors directly on smooth muscle cells; these receptors mediate contraction and their affinity for the various opiate agonists is similar in order and magnitude to the affinity of neural opiate receptors. VIP receptors were also shown to exist on smooth muscle cells; these receptors mediate smooth muscle relaxation via an increase in intracellular levels of cyclic AMP. The results support the view that VIP is the main non-cholinergic, non-adrenergic relaxant neurotransmitter of the gut.